Health budget reduced of Rs 6,000 crore due to underutilization of funds

Recently, Govt. of India reduced health budget this year. On reduction in health budget to the tune of Rs 6,000 crore, the minister said the finance ministry took the decision due to underutilization of funds and that it will not impact any major program.

“There is no dearth of funds to run key programmes. The decision to cut the budget was taken since funds lay unutilized,” Union health minister J P Nadda said.

A senior health ministry official blamed the states for under-utilisation of funds. “Health is a state subject. The health ministry’s role is limited to policy formulation, finance and technical assistance to them. But reports show several states have failed to utilise the funds leading to drastic cut in the budget allocation. However, once the services are optimized, our government will make sure that demands for funds are met,” the official said.

In December, I raised a point that 75% of allocated fund is still lying un-utilised for this year, and Govt. of India took the steps to prevent the misuse of remaining untilised funds in healthcare sector.

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